Headline: Andy Burnham Pledges to Restrict Non-Compete Clauses to Boost UK Economic Growth

Date: 9 October 2026

Tags: UK Politics, Economy, Employment, Business

Summary:

- Prime Minister Andy Burnham has pledged to restrict non-compete clauses preventing employees from joining competitors or starting businesses.

- Burnham said existing restrictions had gone too far and were holding back innovation and economic growth.

- Government research estimates approximately five million UK jobs are covered by non-compete clauses, typically lasting six months.

- Burnham argued the clauses can force workers into periods without pay and prevent growing companies from recruiting skilled employees.

- The Government is considering restrictions including a complete ban, salary-based exemptions or limits on the duration of clauses.

- Burnham confirmed plans for legislation but did not specify which restrictions would be introduced.

- The Recruitment and Employment Confederation warned sweeping changes could undermine protections for commercially sensitive information and client relationships.

- Burnham also suggested further tax reforms to encourage British start-ups and high-growth companies to remain in the UK.

- The Government is considering regional investment funds modelled on Greater Manchester's Good Growth Fund.

- Further details on employment restrictions, tax incentives and investment proposals are expected alongside the Budget on 28 October.

Why this matters: Restricting non-compete clauses could increase workers' job mobility and help businesses recruit talent. However, employers have raised concerns about protecting confidential information and maintaining investor confidence.

What’s next: The Government is expected to announce its proposed restrictions and further measures supporting business investment during the Budget on 28 October 2026.